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Friday, March 20, 2009

In August 2008, in the midst of the Beijing Olympic Games, I collected data from the six largest adopting Provinces in China to look at the near-term prospects for a referral speed-up. At that time, faced with ever declining submission rates, I predicted that referrals would continue to decrease, and wait times increase over the foreseeable future. On August 11, 2008 the CCAA finished January 2006 applications. Seven months later, the CCAA is just beginning the referral of families that have applied in early March 2006. Since August 2008, the wait time has increased six months.

While some families speculated that after the Olympics referrals would pick up, this has failed to happen. In fact, a look at the "supply-side" of the equation provides evidence that there will probably not be any significant speed-up in referrals until the last half of 2009, if at all. The China program continues to labor under an increasing demand trend, and a declining supply of children to fill that demand.

Looking a the top six Provinces, 2008 saw the continuation of a declining trend. In 2006, total submissions for Guangdong, Jiangxi, Hunan, Chongqing, Guangxi and Jiangsu were 7,427, a number that fell to 5,750 in 2007, and which fell further last year, to 4,958. Thus, since 2006, submissions for the six largest Provinces have declined 33%.

In the last year, trackers of referrals have noticed an uptick in the number of male children being referred. Most of the data is anecdotal -- agency announcements, Yahoo DTC groups, etc. Looking at the six largest Provinces lends substantiation of this conclusion. In 2006, 611 boys were submitted by our study Provinces. This number increased to 879 in 2007, and increased further in 2008 to 1098. In fact, the percentage of boys referred has increased from 8% in 2006 to 15% in 2007 to over 22% in 2008.

The increase is not consistent across China. The largest increase in male referrals was seen in Guangdong Province, which saw male referrals more than double from 2006-2008, increasing 129%. Whereas Guangdong's referrals were 8% male in 2006, in 2008 that percentage climbed to nearly 24%.

Jiangsu Province also saw a large increase, more than doubling between 2006 and 2008. Hunan Province saw their male referrals increase 80%, while Chongqing's male referrals increased 61%. Jiangxi Province increased 45%. while Guangxi increased the least, increasing only 22.5%. Clearly things are changing in China. As the real numbers of female referrals drops sharply, the real number of male referrals is increasing. This is turning preconceived notions of China on its head.

One probable explanation for the increased number of boys being submitted is the changing attitudes towards girls in general, and increased pre-marital sex among China's youth. A single woman is just as likely to abandon a boy child as a girl, so as sexual mores change among China's youth, one would expect the sex-ratios of abandoned children to equalize. I believe this largely explains the increased number of boys being found.

However, total submissions across China have continued to decline, mostly the result of fewer abandonments. This decline can be attributed to several factors -- ultra-sound technology, changing attitudes towards girls -- but the largest factor, I believe, is that the black market for children results in fewer children from being abandoned. The Chinese are nothing is not practical.

One can see the problem orphanages face by analyzing the "wholesale" prices (paid by traffickers for healthy infants) of trafficked children over the past five years. In 2001, for example, traffickers in one story received 200 yuan for each child. This number had risen to 1,200 - 2,000 yuan per child by 2003. By early 2009, reports indicate that the wholesale price has risen to 7,000 yuan for girls in some cases.

As the market for black-market children has increased, fewer Chinese families simply abandon their child on the street. Thus, orphanages have seen their numbers of foundlings decrease. This is true even in the orphanages involved in baby-buying programs such as Fuzhou (Jiangxi), which have seen their numbers decline even as "rewards" have been increased for children. Clearly the market has moved away from the orphanages.

It will be interesting to watch what impact the increased donation will have on submission rates. The increase from $3,000 to $5,000 was ostensibly made by the CCAA to help offset the declining revenues resulting from fewer adoptions. But as we move into 2009, it will be interesting to watch if any orphanages see significant increases in the number of children "found". Preliminary surveys of January and February 2009 submissions indicate that the number of children being "found" is increasing. In July we will look to see if these increases are concentrated in any specific areas or orphanages.

If there is an increase in submissions, will it be children that were "held back" (found before 2009)? Or will the increase come from new "foundlings" (children found after the increase)? Or will the increase raise the financial bar for domestic families, resulting in even fewer orphanage children being adopted domestically? Supporters of the international Hague agreement on adoption will want to watch these trends as they develop.

At this point, there is little reason to believe that referral rates will increase significantly in the near-term. As of the end of 2008, submission rates were overall in decline, but with the sex ratio of the children submitted increasing.